Hansa Investment Company and Ocean Wilsons Agree Recommended £900m All-Share Merger

A Major Move in Investment Land: Hansa and Ocean Wilsons Join Forces

Right then, let’s cut through the jargon and unpack what this £900 million all-share merger between Hansa Investment Company and Ocean Wilsons really means. Two established players are stitching themselves together to create something bigger, bolder, and – if all goes to plan – significantly more efficient. This isn’t just corporate reshuffling; it’s a calculated bet on scale and strategy in a tricky market.

The Nuts and Bolts: How the Deal Works

At its core, this is a classic share swap:

• Ocean Wilsons shareholders get 1.4925 New Hansa Share Units for every share they hold.
• Each of these units comprises one voting ordinary share and two non-voting ‘A’ ordinary shares.

The math behind this ratio? It’s based on Formula Asset Value (FAV): Ocean Wilsons’ FAV per share (£20.16) divided by Hansa’s FAV per share unit (£13.51). Simple, transparent, and grounded in asset values. Post-merger, the ownership split shakes out like this:

• Existing Ocean Wilsons holders: 41.4% of the combined group.
• Existing Hansa holders: 58.6%.

Expect around 28.3 million new Hansa Share Units to be issued – creating a single entity with over £900 million in net assets. That’s serious heft.

Why Merge? The Compelling Logic

This isn’t just about getting bigger for the sake of it. Both boards are singing from the same hymn sheet about the strategic firepower this unlocks:

• Scale & Diversification: Combining forces creates a £900m+ investment powerhouse with a truly global, multi-asset portfolio – spanning funds, direct equities, and private assets. Size matters for liquidity and market clout.
• Synergy Central: Crucially, both portfolios are already managed by the same investment team (Hansa Capital Partners/HAML), with significant overlap in objectives and holdings. This merger streamlines everything under one roof.
• Cost Crunch: Here’s the kicker for shareholders – lower fees. The combined entity adopts a tiered management fee: 0.8% on the first £500m of NAV, dropping to 0.7% above that. This replaces the current 1% fees each company paid separately and ditches Ocean Wilsons’ performance fee. The result? A materially lower ongoing charges ratio.
• Liquidity Boost: A larger market cap and free float should improve secondary market liquidity, potentially helping narrow the discount to NAV that often plagues smaller investment trusts.

As Jonathan Davie, Chair of Hansa, put it: “The Combination will bring together two businesses with a similar approach to investing… enabling shareholders to benefit from an enlarged investment portfolio, enhanced liquidity and greater cost efficiencies.” Caroline Foulger, Chair of Ocean Wilsons, echoed the sentiment, highlighting the platform for “long-term, sustainable shareholder value.”

The Vision: Strategy of the Combined Beast

Post-merger, the new “Hansa Investment Company Limited” (keeping the Hansa name) won’t just be bigger; it’s aiming to be smarter. The investment strategy rests on four pillars:

• Genuinely Long-Term: Riding out volatility, staying invested through cycles to access opportunities others might miss.
• Truly Differentiated: Moving beyond the traditional 60/40 portfolio blend, focusing on a multi-asset approach across:
  • Core/Thematic funds (regional/thematic exposure)
  • Diversifying Assets (lower correlation, better drawdown profile)
  • Global Equities (direct holdings)
  • Private Assets (illiquid opportunities)
• Highly Aligned: Significant director/manager shareholdings ensure skin in the game.
• Deep Asset Class Knowledge: Leveraging the team’s expertise across different strategies.

The cash pile from Ocean Wilsons’ recent sale of Wilson Sons (net proceeds ~$449m) will be progressively deployed across these sleeves, maintaining Hansa’s current profile while funding private asset commitments.

A Sharper Approach to Capital: Buybacks Over Dividends

This is a notable shift. The combined group plans to:

• Pay minimal dividends (only enough to avoid being classed as a “non-mainstream pooled investment”).
• Prioritise annual share buybacks of 2-4% of issued share capital (targeting both Ordinary and ‘A’ shares).

The logic? Buying back shares at a discount to NAV is seen as a more effective way to enhance long-term shareholder value than dividend payouts. Timing will be savvy, considering the discount level, market conditions, and upcoming capital calls.

Governance & The Road Ahead

The new board blends Hansa’s directors with two additions from Ocean Wilsons (Andrey Berzins and Christopher Townsend). Ocean Wilsons’ Chair Caroline Foulger and Fiona Beck will step down post-completion. Crucially, independent committees from both companies, advised by Peel Hunt (Ocean Wilsons) and Winterflood (Hansa), have deemed the terms fair and recommended approval.

Shareholder support seems strong: irrevocable undertakings and letters of intent cover nearly 50% of Ocean Wilsons shares and over 53% of Hansa’s voting shares needed for approval.

What’s Next?

• Scheme Document, Hansa Circular & Prospectus published by mid-August 2025.
• Court Meeting (Ocean Wilsons) and Hansa General Meeting scheduled for mid-September 2025.
• Target completion: September 2025.

If approved, Ocean Wilsons’ listings (London and Bermuda) will be cancelled, and the combined entity will trade under Hansa’s existing LSE listing.

The Bottom Line

This merger isn’t just a corporate tidying-up exercise. It’s a strategic response to a challenging market, leveraging scale, shared management, and significant cost savings to create a more competitive and resilient investment vehicle. The focus shifts decisively towards efficient capital allocation via buybacks and a streamlined, diversified global strategy. For shareholders in both camps, it promises enhanced liquidity, lower costs, and a simplified structure built for long-term value. One to watch closely as the votes approach in September.